The All-in-One Telecom Carrier: Which is Best for Your Business?

By Jeff Muscarella

EVP, IT & Telecom Practice, NPI

October 16, 2013

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Gone are the days of the phone company. In addition to offering traditional wireline and wireless network offerings, today’s telecom carriers have become all-in-one IT service providers, offering a combination of enterprise IT solutions. Carriers like Verizon and AT&T now have offerings for data center, cloud computing, and managed network and security.

This has sparked some debate among IT professionals. Should companies pursue a single vendor strategy for both network and IT services, or pursue best-of-breed?

There are several cost, contractual and service-oriented risks involved with employing a single-carrier strategy for a broad spectrum of telecom services. And, there are several benefits, not the least of which are easier cost, service and vendor management.

Here are a few additional suggestions to help you decide which type of vendor strategy is best for you, and how to keep costs in check:

  • Single-vendor is efficient, and allows you to leverage volume. But ...What if your all-in-one carrier fails to meet its SLA or enacts unreasonable cost increases? What if they get acquired? These are just a few reasons why many large businesses opt for a multi-vendor environment where the cost and service risks are ultimately lower. On the flip side, there are costs associated with sourcing and managing multiple vendors across the telecom footprint, which can be hard to justify some organizations.
  • Limit revenue commitments. Never commit more than 70 percent of your total telecom spend to a single carrier.
  • No matter your strategy, bid it out. Single carrier or multi-vendor, every provider in your telecom ecosystem should be under pressure to maintain competitive pricing, discounts, terms and conditions. Bid out incremental services to gain negotiation leverage.
  • Validate vendor-initiated savings strategies. All-in-one carriers are well trained to extract more revenue through complex ROI claims and justification. Before you sign up for new services, validate claims through price and contractual benchmarking.
  • Remember: There are no hard and fast rules to selecting a strategy! Each company’s telecom usage profile and infrastructure demands are unique. A complete evaluation of the enterprise network environment and usage demands, as well as a cost-benefit analysis and risk assessment, are essential to determining the best path for the business.